BUSINESS PEOPLE

BUSINESS PEOPLE; Chip Merger to Join 2 Respected Chiefs

Published: May 5, 1987

The merger announced last week between Advanced Micro Devices Inc. and Monolithic Memories Inc. will bring together two of the most respected chief executives in the semiconductor industry - Advanced Micro's showman, W. J. Sanders 3d, and Monolithic's Irwin Federman, a self-described ''green-eyeshade type.''

Mr. Sanders, known as Jerry, is the ultimate Silicon Valley entrepreneur, famous for his fleet of cars, his snow-white hair and witty one-liners. In good times, Advanced Micro was known for throwing million-dollar Christmas parties in San Francisco. A corporate history, published in the Sunnyvale, Calif., company's in-house magazine, was entitled, ''Good King Jerry and his Dragonslayers.''

Mr. Sanders, 51 years old, is also considered an astute executive who built Advanced Micro into the nation's fifth-largest semiconductor company since founding it in 1969. Before that, Mr. Sanders, who grew up poor on the South Side of Chicago, had been a star salesman and marketing executive at the Fairchild Camera and Instrument Corporation.

Mr. Federman, also 51, is less well known but widely respected within the industry. He drives a 10-year-old Porsche and has lived in the same house for 20 years. ''I couldn't be classified as a flamboyant individual,'' he said. ''I'm an accountant.''

Mr. Federman grew up in Brooklyn and graduated from Brooklyn College with a degree in economics. He worked for some accounting firms and small electronics companies before joining Monolithic in 1971 as chief financial officer.

When the Santa Clara, Calif., company ran into severe trouble in 1979, Mr. Federman was named president. He is credited with rescuing the company and making it into one of the more profitable concerns in the semiconductor industry.

In the last year Mr. Federman has gained more visibility as chairman of the Semiconductor Industry Association, the trade group that has been fighting for enforcement of last year's semiconductor trade agreement with Japan and the recent tariffs on Japanese imports.

At first, Mr. Federman will run Monolithic as a wholly owned subsidiary and will take a seat on Advanced Micro's board as vice chairman. Within a year or so, the companies will be integrated and it is unclear what roles the two men will then play.

Mr. Federman said he had no aspirations to replace Mr. Sanders as chairman and chief executive of Advanced Micro, but thought he could still help in the management of the company. ''Because I have no desire to compete with him, we should get along just dandy,'' he said.

Mr. Sanders is also enthusiastic about the merger. ''Sometimes, a couple of princes have to get together to kill kings,'' he said.